PremiumOver-the-top (OTT) audio content accounts for a small slice of the digital entertainment pie, but it is shifting to a higher trajectory. New platforms and content in languages beyond English are driving this change.
It’s the smallest piece in digital entertainment, but it’s gradually stepping up a gear. Over-the-top (OTT) audio content accounts for about 2.3% of the total time spent by Indians on online entertainment options, according to a December 2021 report by RedSeer Management Consulting. This is led by music. But other, smaller pieces in OTT audio like audio stories and podcasts are gaining traction, and drawing increasing interest from paying consumers, advertisers and investors. Last week, Kuku FM, a homegrown, audio-content platform, announced a $19.5 million funding round
Two factors are shaping this bounce in spoken-word content. The first is the stay-at-home culture brought on by the pandemic, which kicked in around March 2020. The second are homegrown, audio-only platforms like Pocket FM, Kuku FM and Pratilipi, which gathered momentum in early-2021 and are opening up this market in newer ways. They are looking at content in languages beyond English in a big way and at new formats like short stories. Some also lean on content generated by users (as opposed to content generated by professional creators).
Google Trends data enables a relative comparison of what users are searching for. Search data from India for the last three years shows that Audible, which streams audio versions of books available on Amazon, has consistently led in search interest. But since early-2021, audio platforms that pivot around non-English languages like Pocket FM and Kuku FM compare well with Audible in search interest. Karnataka and Maharashtra, which are more urban in nature, lead search interest in Audible. By comparison, Chhattisgarh and Jharkhand lead for Pocket FM and Kuku FM.
Beyond English
According to Lal Chand Bisu, CEO of Kuku FM, less than 100 million Indians can consume content in English. Adds Kartik Sharma, a Jaipur-based radio jockey and author of RJ Kartik Motivation, a podcast: “I am a Hindi-speaking RJ. But also, the essence of certain content is better delivered in a regional language." Hence, while the 10 most-popular podcasts on Audible are all in English, those on Spotify and HT Smartcast (whose promoters also publish Mint) are a mix of Hindi and English, and those on Kuku FM are all in Hindi. Pocket FM and Kuku FM allow for user-generated content, and in multiple Indian languages.
Price is another reason for their growing popularity. An Audible subscription costs ₹2,388 per year ( ₹199 per month) for one audio book per month, with the option to purchase more, and some podcasts. Pocket FM and Kuku FM, on the other hand, cost ₹399 per year, with access to all audiobooks and podcasts.
Startup Enterprise
Startups in the audio-platforms space are also drawing investor interest. In this set, the maximum funding has been received by Pratilipi, of $81.6 million, according to deals database Crunchbase. This Bengaluru-based company, founded in 2015, supports audio stories and user-generated content in 12 languages. Kuku FM and Pocket FM, both founded in 2018, have also raised external funds.
Kuku FM, which says it has 500,000 paying users, started with podcasting in an interview format. It then moved to user-generated content. Ultimately, it found stability in a business model that pivots around long-form series content—typically, 20-100 episodes—and user subscription. Says Bisu of Kuku FM: “Ad revenues are very difficult in India, as 90% of the market is captured by Google and Facebook. We asked 3,000-4,000 users if they were willing to pay, and we received a positive response from 85%."
Fast Forward
The RedSeer report cited above estimated India to have 95 million monthly active users of podcasts at the end of 2021—a year-on-year growth of 34%. A PwC report, titled “The Global Entertainment and Media Outlook 2020-2024", is bullish on growth of spoken-word content in India. It projects monthly podcast listeners to grow at an average 30.4% in the next five years, helped by low subscription rates and data tariffs, voice search, and business models that blend free-to-use and subscriptions.
In India, PwC estimates that revenues from this segment will increase about 90% from $0.9 billion in 2020 to $1.7 billion in 2024. That’s about five times the growth estimated globally, where too consolidations and realignments are happening. On 18 February, Spotify acquired two companies specialising in technologies related to marketing, advertising and analytics for audio content. Play on.
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